(CN) – Commercial label maker Multi-Color Corp. faces a shareholder derivative class action for allegedly misrepresenting and omitting key information surrounding an acquisition of the company by its parent W/S Packing Holdings Inc.
The complaint, filed in the Court of Common Pleas of Hamilton County, Ohio by lead plaintiff Eric Sabatini alleges Multi-Color left out key information about the merger.
According to the complaint, Multi-Color issued incomplete disclosures in the proxy statement filed with the Securities and Exchange Commission in connection with the deal.
Shareholders claim the proxy statement failed to disclose pertinent information about services performed by Multi-Color’s financial advisors Goldman Sachs and William Blair & Company.
“With respect to Goldman’s illustrative discounted cash flow analysis, the proxy statement fails to disclose the individual inputs and assumptions underlying the discount rates ranging from 8.25% to 9.25% and the perpetuity growth rates ranging from 1.5% to 2.5%,” the complaint states.
Shareholders also claim that the statement failed to mention Multi-Color’s forecasted net debt for each of the fiscal years 2019 to 2021 as well as other financial metrics found by the company’s financial advisors.
Moreover, Multi-Color’s SEC statement allegedly failed to state whether they entered into confidentiality agreements that may have stopped other companies from making competing offers for the acquisition.
The class is represented by John C. Camillus in Columbus, OH.